IRVINE : Council to Get Auditors’ Report on Officials’ Investment Actions

A long-awaited report by outside auditors on the actions of city officials in relation to the failed county investment pool is expected to be released to the City Council today.

But how much of the potentially sensitive report will be disclosed to the public--and when--is uncertain, as the council plans to meet in closed session to review the findings.

“The public has a right to see this, once we’re past the stage of litigation,” Councilman Greg Smith said. “The question is not if but when the public will see it.”

The report by auditors from the Price Waterhouse accounting firm tracks the actions of city officials from 1989, when the city first put money in the pool, through the Dec. 6 county bankruptcy.

A small group of community activists, led by former Democratic congressional candidate Gary Kingsbury, have said they will launch a recall drive against council members Barry J. Hammond and Paula Werner and Mayor Michael Ward unless City Manager Paul O. Brady Jr. and Finance Director Jeff Niven are fired.

All three council members voted in July to borrow $62 million to make an extra investment in the county pool after they were reassured by Niven that the pool was safe.

Council members Smith and Christina L. Shea voted against the investment.

If the report shows that any city employees deliberately misled the council about the safety of the county investment pool, Ward said, they will be fired. But he said demands for the firing of city officials are premature.

“Everybody’s looking for a scapegoat,” Ward said. “But I don’t feel you should fire people unless you have just cause. This report will show if anybody did anything blatantly wrong.”